CHAPTER FOUR: GENERAL DISCUSSION

The primary objective of the present research was to explore how psychological contract measurement and theory can best capture the true experiences of employees. As psychological contract research has continued to grow in popularity over the past 50 years (Conway & Briner, 2009), many researchers have questioned whether or not the construct is truly capturing how employees view the employer-employee relationship and their contracting experiences (Seeck & Parzefall, 2008). I approached these measurement and theoretical concerns in a unique way by implementing a mixed methods research design. Collectively, the two studies provided a new perspective on how best to measure psychological contracts and what a theory of psychological contract should entail.

This chapter is organized into five sections. I first summarize the research

findings by focusing on the collective conclusions drawn from both studies. In the second section, I revisit my overarching research question and address whether or not it was sufficiently addressed and what new questions emerged along the way. Many researchers using qualitative approaches, including those in the field of organizational research, recommend revisiting the original research question (Gephart, 2004; Willig, 2008). In the third section, limitations and directions for future research are presented. The fourth section examines the implications of the findings for management. Lastly, in the fifth section I provide guidelines and recommendations to empower employees themselves in their contracting experiences.

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Summary of Research Findings Psychological Contract Measurement

The interview findings supported recent claims that the feature-based approach is superior to the evaluation and content-based approaches for measuring psychological contracts (e.g., DelCampo, 2007, see Table 4 for additional support). Both studies sequentially contributed to the revised measure’s instructions, leading statement, and specific feature dimensions. By listening to the respondents’ contracting experiences and reviewing existing psychological contract research, I was able to design survey

instructions that tap back into the exchange element of the relationship, a key component of psychological contract theory (Cullinane & Dundon, 2006; Meckler, Drake, &

Levinson, 2003). Of primary importance is that the factor structure of the revised

measure also supported the existing typology found in psychological contract theory (i.e., relational and transactional). The factor structure also revealed two new forms of

relationships that may be developing as a function of the changing economy. As I noted in Study 2, I encourage researchers to continue using the feature-based measure to assess contract types because it is content free, transferable across a variety of organizational situations, and reflects the types of contracts prevalent in today’s workplaces.

From a practical standpoint, the revised feature measure can also be used by management as a diagnostic tool to gain insights on their employees’ perceptions. For example, management may administer the measure and find that the majority of employees rate the relationship low on trust. Managers can then use such findings to identify ways to improve their employer-employee relationships, and subsequent employees’ work attitudes and behaviors. I present more specific management

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implications later in the chapter. Overall, the feature-based measure was designed to be applicable in the eyes of employees completing it and also managers using it in a variety of organizations.

The present research also illustrated the benefits of implementing and combining different methodologies to gain a deeper understanding of how best to measure

psychological contracts. I agree with Taylor and Takleab (2004) that researchers need to be more creative in their methodologies when investigating psychological contracts. Study 1 showed how informative employees can be to researchers in understanding psychological contract theory in today’s work environment. For example, the present research was the first to ask employees directly about whether or not the concept of psychological contracts resonated with them and why. The interview findings played an influential role in then designing and testing the revised feature-based measure. Another example of a different methodology is Montes and Zweig’s (2009) use of experimental designs to learn more about psychological contract breach measures and whether or not they are accurately taping into the construct. Overall, examining psychological contracts from different lenses and methodologies, I believe, is essential in ensuring the measures remain valid and relevant, in the eyes of employees and management.

Psychological Contract Theory

Researchers in organizational research emphasize the importance of theory and use it to make sense of workplace phenomenon and to guide their research (Edwards, 2010). Despite the value theory in grounding research, organizational researchers rarely test some of the assumptions underlying their theories (Edwards, 2010). Psychological contract theory is no exception and, as a result, has many unresolved issues that prevent

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the theory from moving forward in any meaningful and practical way (Cullinane & Dundon, 2006). In Study 1, I focused on examining key assumptions of psychological contract theory directly, such as who represents the other psychological contract party and how core perceptions change over time. In Table 3, I presented a variety of theoretical assumptions that I found to be supported (e.g., psychological contracts are perceived to be evolving over time). I also found a variety of theoretical assumptions that were not supported by the interview findings (e.g., psychological contracts are

universally desired). Study 2 further quantified these findings and identified the implications of these psychological contract perceptions.

As noted earlier, the existing psychological contract literature focuses primarily on contract breach (Conway & Briner, 2005). Study 2 contributed to the extant field by examining the relations between contract feature perceptions and organizational

commitment (affective, normative, and continuance), engagement (dedication, absorption, vigor), and turnover intentions. My predictions regarding the relations between the work variables and contract type perceptions were generally supported. Relational contract scores, and to a lesser extent Transactional contract scores, accounted for variance in commitment, engagement, and turnover intentions beyond that explained by employer contract fulfillment perceptions and demographic information. Overall, these findings contribute to a greater understanding of the implications of psychological contract perceptions in the workplace. I hope the revised measure encourages researchers to use a feature-based approach to further explore the influences of psychological

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Research Question Revisited

Recall that my overarching research question stated; “How can psychological

contract measurement and theory best capture employee experiences?” I believe the

present research addressed some important issues within this question but that, in doing so, it also raised some new questions. For example, respondents in Study 1 frequently compared their psychological contract to others internally (e.g., coworkers) and

externally to the organization (e.g., peer). I argued that contract comparisons must have been salient in the minds of respondents because no interview questions asked about comparisons. To my knowledge, there is no measure that addresses contract comparisons among peer groups and coworkers. As noted earlier, Ng and Feldman (2008) recently introduced a measure termed contract unreplicability, but it measures how the

employee’s current organization compares to other organizations. Further exploring contract comparisons was beyond the scope of Study 2 but would be of value to be considered for future research. These additional insights gathered in Study 1 illustrated that qualitative approaches provide the luxury of identifying what psychological contract issues are most salient in the minds of employees. If psychological contract researchers incorporate similar methodologies in their work, the field as a whole has a greater chance of uncovering new insights that may go unnoticed by using traditional survey-based measures.

Limitations and Directions for Future Research

First, a limitation of both studies was that the designs did not permit an exploration of psychological contracts over time. The importance of viewing psychological contracts as evolving relationships has been stated numerous times

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throughout this research project and by past researchers (Conway & Briner, 2005). Study 1 did ask respondents to speak about their psychological contracts over time, but only retrospectively. Study 2, however, did not address the changing nature of psychological contracts at all. Because the evolving nature of psychological contracts was not a primary focus in the present research, I’m unable to contribute much to the understanding of that key characteristic of psychological contracts. Notwithstanding, I think the design of the present study does provide valuable insights into new approaches for studying

psychological contracts across time. For example, I recommend future researchers consider mixed methods designs that involve studying one sample across time, and using a variety of methods at each time point (e.g., interviews and surveys). Termed a

concurrent nested strategy (Creswell, 2003), such a design could contribute to a

comprehensive understanding of contract perceptions over time.

A second limitation relates to lack of organizational contextual factors that were accounted for in both studies. Context factors can include the organization (size,

structure, industry), worker (age, gender, education), and the external environment (e.g., labour market, country; Johns, 2006; Rousseau & Fried, 2001). For example, Study 1 was limited to recent graduates who had limited tenures. Findings from Study 2 suggested that tenure, and to a lesser extent age, were significantly related to contract perceptions. For example, individuals with a longer tenure were more likely to report perceiving a psychological contract, but less likely to desire one, compared to individuals with a shorter tenure. The significant difference across tenure levels found in the present research is informative to theory and worth addressing in future research. I discuss the role of tenure shortly from a practical viewpoint in terms of management implications.

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A limitation in terms of organizational context is that only industry and

organizational size were accounted for in the two studies. The present findings suggest that organizational size plays a role in some aspects of psychological contract theory (e.g., who the other party in the psychological contract is; Study 1), but not others (e.g., whether or not a psychological contract is perceived or desired; Study 2). I recommend that size continue to be included in future research. Another organizational factor that warrants further consideration, but was excluded in the present research, is union

presence. One respondent in Study 1 noted that a presence of a union in his organization made it difficult for him to perceive a psychological contract because his union ensured all contract terms were explicit and collective. Interestingly, the respondent’s comments resonate with those made by Levinson (1965). Levinson noted that unions can prevent psychological contract relationships from developing because organizations may not be able to offer opportunities that go beyond the legal contract. Unions exist in a number of sectors including education, public service, manufacturing, and transportation (Human Resources and Skills Development Canada Union Membership in Canada, 2010). Although empirical evidence examining the relations between union membership and psychological contracts is limited, Turnley, Bolino, Lester, and Bloodgood (2004) did find that perceived psychological contract breach related positively to union commitment. What would be interesting to know is whether or not the high ratings in union

commitment are detrimental to other commitments (e.g., work group or organization). Beyond the initial evidence of Turnley and colleagues, little is known about the role union membership may play in psychological contract perceptions. Future research could examine whether belonging to a union or not influences the presence of a psychological

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contract (i.e., yes or no), and if yes, what type of contract is perceived (i.e., relational or transactional). Overall, a key component of theory refinement is identifying the

boundaries of the theory (Gray & Cooper, 2010). The present study identified some contextual boundaries that should be considered in future psychological contract research.

A third limitation relates to measurement concerns in Study 2 but has broader implications for psychological contract measures in general. While Study 1 respondents were provided with a definition of psychological contracts, this was not the case for Study 2. In Study 2, participants were asked about the presence of “a relationship with your employer that goes beyond what is (or would be) covered in a legal contract”. The survey statement was somewhat vague to avoid the use of psychological contract

terminology specifically and to represent a more natural language that was gathered from the interviews in Study 1. In doing so, however, it is difficult to know with certainty that participants were interpreting the survey questions as I, the researcher, had intended. With that in mind, one method that may be particularly informative in future

psychological contract research is cognitive testing (Fowler & Cosenza, 2009). Cognitive testing is a method that involves asking participants to read a survey and complete a cognitive thought process task. The goal of cognitive testing is to understand the thought process involved when answering survey questions, in order to improve the measure. For example, the participants may be asked to think out loud concurrently while completing a survey or they may be asked afterwards to participate in a discussion with the researcher about the survey in general (Fowler & Cosenza, 2009; Singleton & Straits, 2002). Cognitive testing is rare in organization perception research but certainly of value

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(Tetrick, personal communications, April 15th, 2011). I recommend that cognitive testing be introduced in future research because it has the potential to provide much needed insights on adequately capturing a natural terminology that resonates best with employees.

Management Implications

Psychological contract research is often criticized for not providing practical guidelines and implications for managers (e.g., Coyle-Shapiro & Shore, 2007). Conway and Briner (2005) noted that practical advice to managers is typically given as

afterthoughts in articles which mostly focus on contract breach issues. Nadin and Cassell (2007) also noted that many recommendations involve human resource management practices that not all budgets can support (e.g., increase professional development workshops). While there have been short comings of management implications in the past, the present research does provide meaningful insights. My guidelines and recommendations for management focus on three initiatives: encouraging open communication, providing psychological contract training to management, and

implementing supportive organizational programs that foster psychological contracts. First, both studies illustrated that employees do not universally perceive and/or desire a psychological contract. With that in mind, management should meet with employees, continuously throughout their tenure, to determine how they view the employer-employee relationship. Employees’ needs may change and it is important that management monitor these changes (Rousseau & Greller, 1994). I noted earlier that a desirability for a psychological contract decreases as tenure increases. By meeting with employees regularly, management can gain a better perspective about how these desires

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change over time. Also noted earlier is that management can use the revised feature- based measure as a complementary tool to gain greater insights on their employees’ perceptions, along with face-to-face interactions. These reality checks are essential to ensuring the relationship reflects the needs and desires of both parties.

While open communication is important to building positive employer-employee relationships, the actual terms of the psychological contract do not necessarily need to be made explicit. Two books on psychological contracts have been written for a practitioner audience (i.e., Makin, Cooper, & Cox, 1996; Wellin, 2007). Both books suggest that management should make the psychological contract explicit. Wellin (2007) goes into detailed guidelines on how a leader can initiate a psychological contract with his/her subordinate. My concern is that the time spent laying out clear guidelines of what the relationship entails is only beneficial in stable work environments. As found in Study 2, the factor structure of the feature-measure revealed two short-term contract types that are prevalent in today’s organizations. Even if the work environment is stable, psychological contracts perceived as mostly explicit in Study 2 were defined as transactional contracts. Recall that Transactional contract scores did not positively predict affective and

normative commitment, but did positively predict continuance commitment and turnover intentions. Based on these study findings, I recommend management communicate openly with their employees about the psychological contract, but by doing so does not need to imply that all terms be made explicit.

In line with the recommendation for open communication, I also recommend that employer representatives who are in supervisory roles receive training on psychological contracts in the workplace. I recommend that employer representatives receive training

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on the general importance of the psychological contract, how it influences work attitudes and behaviors, and how they can communicate the terms of the relationship with

employees. Lester and colleagues (2007) made a similar suggestion for organizations that are undergoing changes that may adversely impact psychological contract perceptions (e.g., breach). In Study 1, only about half of the respondents gathered information about the psychological contract from the other psychological contract party. Several stated that they did not feel comfortable speaking with the other party directly. With that in mind, and to ensure open communication, it is in management’s best interest to receive training on psychological contract relationships with their employees.

My last recommendation relates to implementing organizational programs and structures that support psychological contracts. Specifically, management should consider what they can do to foster the development of positive employer-employee relationships. For example, one respondent in Study 1 noted that her organization assigns each new employee to a senior employee, termed a counselor. For this respondent, a positive relationship developed quickly with the counselor, despite the fact that the organization was large and turnover was high within her department. She reported that her counselor was perceived as the other party in her psychological contract. I recommend that organizations implement similar programs and policies that encourage employees and employer representatives in developing positive and personal relationships.

Employee Implications

Existing literature lacks guidelines and suggestions to empower employees themselves in managing their psychological contract relationships at work. Similar to management, I encourage employees to take the initiative to form a relationship with

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another party that goes beyond the legal contract. Respondents in Study 1 noted that they felt the psychological contract played a more influential role on their daily work

activities, compared to the legal contract. Furthermore, in Study 2, employees who perceived a psychological contract were more likely to score high on commitment and engagement ratings, compared to those who did not perceive a psychological contract. Employee commitment and engagement have been linked to not only retention and performance but to employee’s physical and psychological well-being (Bakker,Albrecht, & Leiter, 2011; Meyer et al., 2012; Meyer & Maltin, 2010). Consequently, if employees can manage to develop psychological contracts, positive work experiences and well- being likely will result.

Recall in Study 1 that respondents identified a variety of other parties (e.g., supervisors and work groups) and there was no reason to believe that one specific party was superior to the others. With that in mind, I encourage employees to form a broader working relationship with an employer representative. This representative should a) be a valuable resource for organizational information, b) have the power to make and fulfill promises, and c) be someone with whom the employee feels comfortable communicating. I also encourage employees to be open with this employer representative about their contract perceptions and what they desire to obtain and give in the relationship. Overall, I